This is the third edition of the CMS Guide to Anti-Bribery and Corruption Laws, fully updated and expanded to cover 26 countries, including the BRIC nations.
The global anti-corruption landscape has seen major changes since we published the last edition in summer 2011. Some jurisdictions have completely overhauled their laws. Many have strengthened and extended the reach of their regimes, for example by making legal entities as well as individuals liable for corruption offences and by introducing stiffer penalties for financial crime.
For each of the 26 countries, the guide answers the following key questions:
- What are the key offences?
- Who can be liable and when?
- What are the penalties?
- What are the defences?
Key points of note:
- Corporate liability – the Czech Republic has strengthened its laws to make legal entities liable for corruption offences. Brazil remains one of the few countries where organisations cannot be directly liable for corruption offences, but proposed new laws would introduce corporate liability and the possibility of fines up to 30% of turnover.
- International convergence – there remains no international anti-corruption law or standard. However, an increasing number of countries are signing up to international conventions such as the 1997 OECD Convention on Combating Bribery of Foreign Public Officials in Business Transactions, and the 2003 UN Convention Against Corruption. Countries are moving towards a consensus on what conduct is criminalised, if not on how it is criminalised.
- Scope of laws – all of the countries outlaw public sector corruption. Only two (India and Bosnia & Herzegovina) do not criminalise private sector bribery.
- Liability for public sector corruption – there is no universal agreement on whose conduct is criminalised. In some countries only the public official can be prosecuted, in others it is the “briber”, and in others both.
- International jurisdiction - most nations exercise jurisdiction beyond their borders, with 21 of the 26 holding individuals resident in their jurisdiction liable for corrupt acts committed in other states. More than half of the countries covered in the Guide allow for the prosecution of local organisations whose foreign subsidiaries commit bribery offences. Companies doing business in any of the 26 countries should take note.
- Stronger laws on financial crime – where countries have made changes, they have increased the scope of applicable laws and introduced stiffer penalties for wrongdoing. In Switzerland the maximum penalty for individuals committing private sector bribery has risen ten-fold to more than CHF 1 million; in Austria it has more than doubled for some offences.
- Anti-corruption procedures – organisations in the UK and Italy can benefit from a “defence” based on having adequate anti-corruption procedures in place. Corporate entities in Portugal can avoid liability if they can show their employees acted against express instructions. Russia has made the introduction of anti-bribery procedures mandatory for companies, a similar approach to that of the US.
Omar Qureshi, Head of Anti-corruption, CMS UK, comments, “Anti-bribery and corruption continues to be an increasing focus for legislators and prosecutors around the world. There is a growing consensus on what types of conduct are criminalised, but there remain significant differences between countries in how the laws are applied and against whom. Given the widening scope of these laws and the penalties that can apply, it is more important than ever for businesses to be aware of the heightened risks these changes entail.”
Countries covered in the guide: Albania, Austria, Belgium, Bosnia and Herzegovina, Brazil, Bulgaria, China, Croatia, Czech Republic, France, Germany, Hungary, India, Italy, The Netherlands, Poland, Portugal, Romania, Russia, Serbia, Slovakia, Slovenia, Spain, Switzerland, Ukraine, United Kingdom.
Focus France by Stéphanie de Giovanni: International anti-corruption regulations apply to French groups and companies
French worldwide groups and companies, and particularly those having subsidiaries or commercial partners in the United Kingdom or in the United States of America should urgently set up tools in order to fight international corruption. Indeed, as a critically important matter, appropriate internal procedures, including a code of ethics, should be adopted.
Recent news has shed light on international corruption issues to which business operators, are confronted in their relationship with foreign public officials. Within an intricate regulatory context, French companies must ensure that corporate procedures are compliant with the following international applicable legal framework of reference: the OECD Treaty, the American extraterritorial anti-corruption law or “FCPA” (i.e. the “Foreign Corrupt Practices Act”), French anti-corruption criminal law applying to foreign public officials, and more recently, the « UK Bribery Act » which has been effective since July 1, 2011.
The record fine Siemens was condemned to pay to the American and German authorities, superior to 1.6 billion dollars, as well as the adoption in 2010 of the « OECD Good Practice Guidance on Internal Controls, Ethics and Compliance » highlight the overwhelming need for companies to prevent the risk of corruption inherent in their international exposure. In France, the recent sentencing of the Safran Group by the Paris Criminal Court to pay 500 000 euros, on 5 September 2012, demonstrates the significance of adopting appropriate procedures.
Therefore, international trade operators, and especially those tendering for public procurement contracts (in the pharmaceutical, energy or other fields) or the operators who have to maintain regular contacts with a local authority (for instance the Customs Administration) must develop the necessary corporate and contractual tools.